UPDATED: MAY 24, 2022 | 1 MIN READ
Despite low home values, Oklahoma is one of the costliest states for home insurance. This may be influenced by high property crime rates in the area, or else by the range and severity of the natural disasters that threaten properties in the state. After all, Oklahoma has some of the most severe thunderstorms in the country, and is located in the heart of Tornado Alley. Finding great home insurance in Oklahoma is a matter of knowledge: learning about average policies and concerns for homeowners can set you on the path to finding the perfect policy for you.
- Fun fact: Gordon Matthews (from Tulsa, Oklahoma) patented voicemail in the 1980s.
Average Rates in Oklahoma
Oklahoma is among the most expensive states for homeowner’s insurance – ranking in the top 5 costliest states, according to rankings from the Insurance Information Institute. Premiums average at $1,885 annually compared to the $1,211 national average. Other states with prices comparable to Oklahoma include Kansas (premiums averaging $1,584) and Texas (premiums averaging $1,893).
Although there isn’t a huge range of prices for renters’ insurance nationally, Oklahoma also is one of the most expensive states for renter’s insurance. Premiums average at $236, with only Mississippi having higher renters’ premiums, at $256.
Oklahoma Legal Insurance Requirements
You have no legal obligation to buy home insurance in Oklahoma. Instead, you will likely be required to purchase it as a condition of getting a mortgage or home loan. While the extent of home insurance coverage varies between companies and plans, there are some common features covered by Oklahoma insurance:
- Dwelling: If any part of your home (or attached structures like garages) is damaged, this will help pay for repairs.
- Other structures: This offers the same coverage as Dwelling insurance, but applies to man-made structures not physically attached to your residence, like guest homes, fences, tool shed, garages, and some appliances.
- Personal Property: You can insure some of the contents of your home with this coverage, and they’ll be protected even if they’re lost or damaged outside the confines of your residence. Commonly, furniture, clothing, and appliances can be insured with this coverage, but you will likely need additional endorsements to insure expensive luxury items like jewelry and antiques.
- Loss of Use: If your home is so damaged you need to live outside of it while it’s being repaired, or you are ordered to evacuate from your home during a federal emergency, this can help pay for you to maintain your normal standard of living even outside your home. This can pay for additional expenses from things ranging from hotel stays to grocery bills, in certain circumstances.
- Personal Liability and Medical Payments: While personal liability will help you cover expenses if someone holds you legally responsible (through neglect, not intentional act) of injury to a person or their property. Medical payments can be given to a person who is accidentally injured on your property, up to a specified amount.
Oklahoma insurance companies offer these types of coverages in various “forms,” which vary between companies. The main differences between different forms lies in what “perils,” or damaging events are insured for. The most basic forms only protect against a certain number of “named perils” which are listed on the policy, while forms with more comprehensive coverage can ensure against any peril that there is no listed exclusion for.
Common Risk Factors in Oklahoma
According to Oklahoma’s Insurance Department, properties in Oklahoma experience significant threat from tornadoes, floods, wildfires, hail, earthquakes, and winter weather. Standard homeowners’ insurance will protect you from damages from a good portion of these natural disasters – like tornadoes, wildfires, and hail. But some threats may not be covered:
- Flood: This insurance is NOT offered by standard home insurance. You must instead purchase it through the National Flood Insurance Program. This is only available to you, however, if your community has opted into the program and agreed to do floodplain management. You will often be asked to purchase flood insurance if you live in a high risk zone, where there is a 25% chance you will need to file a flood insurance claim over the course of a 30 year mortgage. You may want to purchase this insurance even if you aren’t in a high risk zone – one in four flood insurance claims come from areas deemed “low risk.”
- Earthquakes: This is another type of insurance not provided through standard home insurance policies – you can purchase it either independently or as an endorsement or add-on to your original policy. Oklahoma earthquakes are increasing in number as fracking practices continue to increase – in 2017, there were 304 “felt” earthquakes above a magnitude of 3.0. In Oklahoma, earthquake insurance will only protect against catastrophic loss caused by an earthquake – that means if you only need minor repairs after earth tremors, your earthquake insurance may not cover it.
- Winter Weather: Every year, bitterly cold winters in Oklahoma come with their own set of challenges for properties. If you have at least Broad Form coverage, you will be protected from damage caused by the weight of snow on roofs and other structures, as well as damage from severe winds. Basic Form policies, however, may not protect you from these damages. Additionally, you may experience hardships related to winter weather that Broad Form coverage cannot insure you for, like fallen tree removal, interior stormwater damage, and water damage from backed-up drains. You may be able to purchase an endorsement for additional coverage, depending on your insurance company.
Insurance Demographics/Statistics in Oklahoma
Is there anything you can do to lower the price of your home insurance? Doing things like installing locks and alarm systems, setting up sprinkler systems and fire alarms can all earn you discounts. But there are also things about your home that you may not have as much control over, that also affect the price of your home insurance. We explore some of these below.
Your Home’s Value
Likely the single biggest determinant of your home insurance price is your home’s value – most of your home insurance is based off of a percentage of the dollar amount your home is valued at. Home value can be calculated either in terms of replacement cost or actual cash value. With replacement cost, you are finding the amount of money needed to completely rebuild and replace your home, using similar materials and using current labor costs. With actual cash value, you find the replacement cost of a home and then make deductions based on pre existing damage, wear and tear, and depreciation.
Home values in Oklahoma are much lower than average, at $132,465. That’s a little over half the national average of $248,857. Keep in mind that you need to assess your home value with a professional – you cannot substitute the sale price of your home for its value. That is because included in the sale price of a home is the price of the land it is attached to. Insurance companies are more concerned with replacing the man-made structure of your home and property, and don’t factor land into home value.
Local Crime Rates
Having a home in an area with high property crime carries the risk of increased insurance premiums, to offset the risks insurers take by insuring a home more likely to file an insurance claim for theft or vandalism. Overall, Oklahoma has much higher rates of property crime, compared to the national average of 1.97%. In 2018, the FBI Uniform Crime Reporting Program found a 2.54% property crime rate in Oklahoma, after excluding auto theft. This may inflate the price of home insurance premiums for homeowners in Oklahoma.
Your Income and Education
Besides your home value and crime rates, insurance companies also look at the personal characteristics of a homeowner, assessing their risk to file an insurance claim and adjusting the price of home insurance accordingly. With most insurance companies, having good credit is an asset that can lower your overall costs in purchasing home insurance. People with high incomes and a college degree are associated with having higher credit scores.
The Census Bureau’s 2018 data records the average household income of Oklahoma as $51,924, and the percentage of people over 25 with a bachelor’s degree or higher as 25.2%. In both cases, this falls below the national average, where household incomes average at $62,179 and the percentage of people over 25 with a bachelor’s or higher falling at 32.06%.
Where to Purchase Home Insurance in Oklahoma
Now that you know more about average policies and property risks in Oklahoma, what comes next! To get home insurance specific to your needs, it’s best to compare many companies and policies against each other. Agilerates.com can put all of that information at your fingertips, giving you accurate quotes from the insurers in your area. It’s the kind of research that can benefit you even if you’ve already purchased a home insurance plan. Every year at renewal time, you have an opportunity to switch your insurance to a plan more beneficial to you. According to the Pulse Whitepaper from iii.org, only 44% of homeowners compare prices of different insurers at renewal time, and only 17% do so online. That means more than half of all homeowners are leaving money on the table at renewal time. Use Agilerates.com online form to get matched with a local agent, get free quotes, and shop around!